How to Fix Your Credit Score for a Car Loan

fix bad credit auto loan

Car Financing Credit Repair

Gene Messer Volkswagen appreciates that financing a car in Lubbock, TX can be difficult. Especially, when you happen to possess less-than-desirable credit.

Is it time for you to buy a new car, truck or SUV? Perhaps you’re attempting to determine how to fix your credit profile for a car lease or loan? You should not be surprised to learn that your auto lease or loan rate is determined by your credit status, history and score, which means rebuilding credit is a smart decision before setting out on a car-purchase journey. Improving your credit requires some work. You will definitely want to keep an eye on your score several months in advance before your car or truck loan or lease application. Improving your credit overnight is impossible. Given enough time, however, you can most definitely make great strides to a better score. Let’s learn how this can help.

Figuring Out the FICO Credit Score

Lenders typically take both FICO credit score and history into consideration while extending an offer. Auto lenders identify the a borrower’s loan or lease eligibility by auditing his or her credit rating.

To assign you a score, credit unions review these five factors:

  • Kinds of credit in use
  • Borrower’s Payment history
  • Amounts owed
  • New credit data
  • Length of borrower’s credit history
  • New Credit

Even with all this detail, the minutiae of credit scoring may still not be clear. Because of the complexity of it all, banks typically use multiple industry-specific factors to decide if you’re a low-risk borrower. Don’t forget, your credit score is an important factor that shows that you are able to pay your regular installments. That means that you should learn how to repair your credit prior to applying for automotive financing.

Reasons to Increase Your Credit Ranking

Car buyers with satisfactory credit may easily qualify for car loans with low interest rates or zero percent financing. an ideal history also presents you with a chance to negotiate during your auto loan. Those with less desirable credit, however, often are ineligible for a rate of zero, small or zero-down payments, and low-interest financing. In brief, you will typically overpay when you have low credit.

Practical Tips for Repairing one’s Credit Score:

A low credit profile is hardly desirable news for any vehicle shopper. But you can easily improve it by working through these simple steps:

  • Closely monitor your credit.
    • In the months prior to your car or truck financing, you should pay close attention to your credit report.
  • Check for red-flag items on your report. Fix them, if possible.
  • Make on-time payments.
  • Every time you don’t make an account payment, your credit rank gets a negative hit. By avoiding it, you can improve your credit score.
  • Use a calendar to manage upcoming bill payments.
  • Be wary of credit card balance transfers.
  • Be extra careful while managing your card balance if you’ve bad credit.
  • If possible, try to clear your existing debt before taking on an auto loan.
  • Track your report and correct any errors.
    • Sign up for free reports from major credit bureaus: TransUnion, Experian, and Equifax. Free Credit Report
  • If you find anything to dispute, be sure to file it.
  • Be sure your report looks impeccably clean.
  • Do not apply for other kinds of credit.
    • Multiple credit applications in a short period of time can negatively impact your score and lower it. Avoid such actions if you’re increasing a weak credit profile.

Lubbock Vehicle Financing at Gene Messer Volkswagen

Car shopping can be an exciting experience which involves more than a few steps to be most successful. For the most ideal financing experience, better your less than desirable credit first. A higher score will aid you in getting a better automotive financing deal with more room to negotiate. Fixing your credit rank won’t happen in a flash; so, give yourself some time and track your credit for a few months prior to taking a step forward with buying or leasing a new car .


Car Financing Credit Repair | Gene Messer Volkswagen